(StraightNews.org) — Republicans and Democrats reached a deal on the debt ceiling days before the looming deadline of June 1st. GOP House Speaker Kevin McCarthy and President Biden reached an agreement to suspend the debt ceiling until 2025. This means the US can pay its debts and avoid a default that would have had global consequences and triggered a recession in America.
Going into negotiations, Republicans wanted a commitment to spending reductions from the White House, and in the final agreement, spending up to 2025 is frozen at this year’s levels, except on defense. Funds put aside for pandemic relief will be returned to the government coffers, meaning an injection of around $30 billion.
Among the key Republican demands were reductions in social welfare spending. The White House insisted that cuts to some benefits, such as Medicaid, were off the table. In addition, GOP lawmakers wanted some conditions placed on eligibility criteria. In the proposed new deal, standards for food stamps have been slightly altered, and the age that people will be required to work to receive food stamps jumps from 49 to 54.
The $80 billion allocated for the Internal Revenue Service (IRS) that Republicans wanted to scrap will remain in place. Student loan relief will also remain – the Biden administration had said it wanted to write off some student debts to the tune of $20,000, but the matter now rests with the Supreme Court.
Rep. Dusty Johnson (R-SD) called the deal, which will be voted on in Congress in the coming weeks, a big “win” for the GOP. “That is a big get for Republicans. That’s what we had in Limit, Save, Grow, and it’s going to save $1.5 trillion over the course of the next ten years,” he said.
The Limit Save Grow was a package of proposals put forward by Republicans to end the debt crisis that had loomed for weeks. It was passed by GOP lawmakers in the House in April.
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